UPDATE 1-Canada to rule on two pipelines, mum on Kinder Morgan expansion plans

Reuters Staff

3 Min Read

(Adds spokesman comment on announcement timing)

By David Ljunggren

OTTAWA, Nov 22 (Reuters) - Canada will this week decide the fate of two Enbridge Inc pipelines, but is keeping quiet about its verdict on Kinder Morgan Inc’s plans to more than double the capacity of its Trans Mountain line, a move strongly opposed by environmentalists.

The Liberal government is expected to veto Enbridge’s Northern Gateway pipeline from Alberta’s oil sands to the province of British Columbia on the Pacific Coast. Prime Minister Justin Trudeau opposes the project, citing the proposed routing through a rain forest.

But Ottawa does appear set to allow Enbridge to replace the Canadian segments of its Line 3, which takes crude from Alberta to Wisconsin. Canada’s energy regulator approved the project in April.

Trudeau is under pressure both from environmentalists and the energy industry, which says it needs more pipelines to ease transport bottlenecks in Alberta.

“Our government is on track for a decision on the proposed Enbridge Line 3 and Northern Gateway projects by Nov 25. An announcement ... will be made soon thereafter,” said Alexandre Deslongchamps, spokesman for Natural Energy Minister Jim Carr.

Trudeau is scheduled to leave on Wednesday for a week-long trip to Africa.

Northern Gateway foundered amid protests from green and aboriginal groups that are now targeting Trans Mountain. But the plan to update Line 3, which sources say will switch from carrying light oil to synthetic crude, attracted little attention.

The upgrade would allow Enbridge to run Line 3 at its maximum capacity of 760,000 barrels per day (bpd). It is currently shipping 390,000 bpd because of voluntary pressure restrictions.

“It’s not adding to capacity,” said Friends of the Earth policy adviser John Bennett. “I haven’t seen any chatter about it at all.”

There is, however, much debate about Kinder Morgan’s plans to build a second pipeline next to its Trans Mountain line from Alberta to British Columbia.

Greens say the risk of a spill is too great and opponents promise massive protests, which some Liberals fear could hurt the party in federal elections set for 2019. Earlier this month, a Liberal legislator from British Columbia urged Trudeau to veto the line.

Environmental groups say they expect Carr to approve Trans Mountain by the Dec. 19 deadline. He said last week that Canada needed to sell oil to Asia to diversify exports away from the United States.

Deslongchamps said Carr was committed to a verdict by Dec. 19. (Reporting by David Ljunggren, editing by G Crosse)